Earlier this year, SAP launched a global team of 23,000 strong under the banner Cloud Success Services. On the heels of that announcement, ASUG had several conversations with the new organization’s leadership on strategy, business priorities, customer impact, and vision.
In this Q&A, Craig Davis, SAP Head of Cloud Success Services for North America, discusses the new organizational structure, service offerings, and initial customer response. We expect Cloud Success Services to be on the agenda during ASUG Best Practices: SAP for Cloud. Find more information and register for our conference at https://www.asug.com/events/asug-best-practices-sap-for-cloud.
This is an edited version of our full conversation.
Q: Could you describe the Cloud Success Services structure, both globally and in North America?
A: Cloud Success Services (CSS) consists of approximately 23,000 people at SAP, so it’s a significant number of personnel, as SAP is a 100,000-person organization. Globally, we have seven CSS regions that match the seven regions across SAP. CSS individuals are spread across the globe. A large group, about 13,000, are in what we call our Solution Delivery Center, which is a “warehouse” of specific and specialized resources.
The North American organization comprises about 2,500 of the 23,000. We have six market units in North America, including the Regulated Industries market unit. In addition, our Strategic Business Office and North American Delivery teams help drive solutions for our customers.
Q: What are CSS-specific offerings, or levels of engagement, for SAP customers?
A: Based on the significance of our Premium Engagement business unit, we separated it from the Strategic Business Office to report directly to me in North America. Globally, Premium Engagement reports to Claudio Muruzabal, our President [watch for the upcoming ASUG interview with Muruzabal in the coming weeks].
Within CSS, we have an essential layer [service] that is included in your SAP software purchase. Then there’s an advanced layer, which is a for-fee approach. “Preferred success” is something you’ll hear in the market and is something we want to make sure customers are participating in. And then, as I mentioned, Premium Engagement is our maximum attention [level], formally known as safeguarding. Ideally, we want all our customers to use Premium Engagement, but we understand that some may not participate at that level.
I want to note that we work with our partners in the portfolio across the essential, advanced, and select layers. Our goal is to drive more partner participation depending on the complexity of the solution we’re deploying with customers.
Q: For the advanced and for the premium/select there are different fee levels, correct?
A: There are different fee levels. For advanced, that’s typically part of the subscription fee. The select layer depends on the solution, deployment, and timelines—more variables go into that.
Q: Why was there a need for the service structure change?
A: Last year, two separate organizations within SAP were responsible for adoption and consumption. We had a separate Services organization that had been around for over 26 years—as long as I have been at SAP. Then our cloud acquisitions and organic growth created the Customer Engagement and Experience organization, which focused on customer experience.
What we did this year was bring those two organizations together. If you think about it, if you’ve heard about [SAP] land-adopt-consume-expand strategy, we had two separate organizations for adoption and consumption. There was a lack of efficiency with that model. We recognized the necessity of bringing these organizations—the adoption and consumption teams—together to help drive more efficiency, agility, and clarity for our customers.
Q: What have you been hearing from customers in terms of their needs and their opportunities, generally? What have you been hearing from customers who are being served in this new structure?
A: Coming off of SAP Sapphire & ASUG Accelerate Orlando, I’ve gotten great feedback. I was part of a conversation with 12 customers who asked questions specific to me and to [Global CSS] COO Volker Reinert. Customers appreciate the two organizations coming together because it helps them through the adoption and consumption part of their journey.
Again, I don’t want to leave off partners because our partners had also been experiencing confusion. We sat with our partners, not only tier-one partners, but also many across our ecosystem. They appreciate the clarity we’re bringing to them; in turn, they can share it with our joint customers.
On the success of the CSS reorganization: I’ve been here several years and I have my trusted customers. I’m their trusted partner, so I can reach out to them and get feedback. I sat with those customers very early on when I started this role, explaining what CSS is all about. And they provided great feedback to me right out of the gate. [Customers said,] “Thank goodness you’re doing this. … I wasn’t sure what this resource was, versus what that resource was.” Bringing these two organizations together brought clarity to them. I continue chatting with them to help us with portfolio changes. We want to ensure that these changes are beneficial for our customer groups.
Q: What are the most critical business or technology challenges that customers voiced at SAP Sapphire & ASUG Accelerate Orlando—or before that?
A: One of the challenges—especially as customers start their transformational journeys to the cloud—is that cloud transformation isn’t easy. How customers will get there isn’t just tactical; it’s not just via lift and shift, moving from ECC, or previous ERP solutions, and lifting and shifting to the cloud. The transformational journey to the cloud is where we’re having more, and deeper, conversations with the customer. We’re helping them move from what may have been customized through years to a clean core approach, allowing customizations to stay on the periphery while leveraging new SAP technologies, such as Business Transformation Platform (BTP), as an example.
Q: Why are some organizations still reluctant to embrace the cloud?
A: First, there’s “FUD”—the old fear, uncertainty, and doubt. That’s where CSS can work side by side with our license counterparts to calm fear, clarify uncertainty, and give customers specific situations to alleviate doubt.
I also think there’s some hesitation based on perceived costs or previous costs.
And the other [reason] is time. There is a time commitment to complete these transformations. The one thing that CSS and our partners work on is getting time to value for our customers much faster. In the past, there have been programs that have lasted far too long, in my opinion. That’s where CSS wants to help customers. That’s where we’re working with our partners to ensure that our customers reach that business value faster.
Q: We also hear that security and privacy issues/concerns in the cloud make some organizations hesitate, especially since security is paramount and is now a board imperative. How does CSS address such concerns?
A: We have people in our organization who focus on security. Being the software provider we are, I believe SAP does this every day from a technology standpoint. I believe that we have the best advisors when it comes to handling those security questions. We work very closely [internally] and talk with systems integrators and hyperscalers.
Q: You referenced portfolio changes earlier. Can you describe some that have occurred and some that will occur?
A: I’ll focus on the select level. Design success, for example, works in conjunction with Premium Engagement to help our customers get an accurate, transformational design. We’re trying to stick to a clean core approach, so when we move down the road—from a TCO position—it’s less expensive to upgrade.
I mentioned that Preferred Success has been around, but there are additional nuances we continue to add. To be clear, Preferred Success involves individuals and tools that our customers can leverage throughout their journey. Customers can leverage these not only during the project, but also after going live to monitor their systems, see the consumption of the software, and find where gaps may exist.
And then, SAP Signavio is a fantastic tool that we leverage, ensuring that we understand the business processes of our customers, especially identifying those outside of normal business processes. SAP Signavio isn’t a CSS tool; it’s an SAP tool, but for our customers, SAP Signavio can absolutely be leveraged. Returning to why some customers hesitate: That’s because they’re dealing with some complexity in their organization. SAP Signavio can help identify and clarify that.
Q: Cloud success: How does a customer measure it? What kind of criteria do you set with a customer? How does SAP measure it?
A: Firstly, we have the standard Net Promoter Score when it comes to customer success. If they aren’t using the software or consuming the software, that can measure a level of success.
We also have Solution Customer Success Partners and Enterprise Customer Success Partners that have ongoing touchpoints with our customers after they go live to ensure that what was acquired or sold is actually being used as expected and to ensure that they’re gaining value.
Q: You mentioned time to value. How do SAP and the customer measure and assess that?
A: We’ll start with a hypothetical nine-month project. We’ve changed how we measure the success of our people and customers. We changed the metric, so instead of basing it on a utilization metric, we’re now deploying an Annual Contract Value metric. So, if the customer planned to be live in nine months, that’s where we’re checking the value the customer is getting. That’s because we’re measuring them getting that time to value based on a schedule, and, ideally, faster.
We’re working with tools, whether we’re using SAP Signavio, leveraging technologies such as BTP, or putting timelines out there to get faster time to value.
We’re also changing the KPIs our teams are measured against because we want to get faster time to value for each customer.
Q: A year from now, what will you count as CSS success?
A: This is something I discuss with all customers and internally. First and foremost, we’re on a journey to reach more of our customers through CSS. And we want to do this in a collaborative, harmonious way with our partners. So, through communication and collaboration, we’re improving every day.
And when we talk about vision to value, we’re ensuring that at the very beginning of an engagement, the customer is getting value. We want to make sure our customers are getting the business outcomes they seek, and we’re trying to do that faster. So, success for us is getting to those outcomes faster across more of our customers.
Even year over year, we’d reached 500 more customers. That’s when CSS was just an idea. In Q1 , we had 405 go-lives that CSS participated in. The 405 go-lives mark a planned achievement. We’ve turned the system “on” for our customers to get software utilization, whether it’s Human Experience Management, procurement, or RISE with SAP. Success for CSS means that we can reach all our customers across our entire software portfolio.